Aluminum Industry Faces Lofty Expectations in 2011
January 17 2011 - 11:25AM
Marketwired
Aluminum prices have surged close to 40 percent over the last six
months, fuelled by a weak US dollar and a recent declaration by the
Federal Reserve to buy $600 billion of Treasuries. Strong demand
from emerging markets should keep aluminum prices rising for at
least the early part of 2011. While global aluminum demand is
increasing, significant production growth, as well as high aluminum
inventories will likely limit aluminum prices from skyrocketing.
The Bedford Report examines the outlook for companies in the
Aluminum industry and provides research reports on Alcoa, Inc.
(NYSE: AA) and Century Aluminum Co. (NASDAQ: CENX). Access to the
full company reports can be found at:
www.bedfordreport.com/2011-01-AA
www.bedfordreport.com/2011-01-CENX
Emerging markets have been a huge source of revenue as
populations and economies in China, Brazil and Russia have become
richer, leading to higher levels of building. One of the
fundamental reasons for the turnaround in the aluminum industry has
been the continued production discipline demonstrated by China.
From 2002 to 2008, China had been a net exporter of aluminum, but
has since become a net importer.
The Bedford Report releases regular market updates on the
aluminum industry so investors can stay ahead of the crowd and make
the best investment decisions to maximize their returns. Take a few
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Last week industry giant Alcoa unofficially kicked off earnings
season. The Pittsburgh based company reported a fourth quarter
profit of $258 million or 24 cents a share, compared with a year
earlier loss of $277 million, or 28 cents a share. Revenues grew
around 4 percent to $5.65 billion as a result of higher aluminum
prices.
Alcoa's Chief Executive, Klaus Kleinfeld, raised his projection
of the growth rate for global aluminum demand to 12 percent,
compared to projections of 13% made last year. China's aluminum
demand is expected to grow by approximately 15 percent in 2011
after skyrocketing more than 20 percent last year.
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